NewLink Genetics Corp (NASDAQ:NLNK)
NewLink Genetics Corp (NASDAQ:NLNK) stock plunged after the company announced the termination of a licensing agreement with Genentech for its IDO inhibitor, GDC-0919,. However, the termination will not affect research collaboration on the discovery of other IDO/TDO inhibitors between the two firms.
GDC-0919 Disappointing results
Genentech’s decision came as a surprise, given that data on the inhibitor was recently presented at the American Society of Clinical Oncology annual meeting. The two companies had signed the licensing agreement in 2014.
NewLink Genetics Corp (NASDAQ:NLNK) stock shed more than a third of its market value on Genentech ending its collaboration on GDC-0919 development. Disappointing clinical trial results appears to have triggered the surprise move by Genentech. The trial of GDC-0919 in combination with Roche’s –PD-L1 failed to yield the desired results.
Clinical Trial results indicate that the response rate for GDC-0919 stood at 9% in patients with solid tumor cancers. The response rate was quite low to justify further clinical research. Epacadostat, a drug being marketed by Incyte Corporation (NASDAQ:INCY), delivered a response rate of 30-35% when combined with Merck & Co., Inc. (NYSE:MRK) PD-L inhibitor.
Even on the disappointing results CEO, Charles Link, remains optimistic about GDC-0919 prospects.
“We are obviously disappointed in this decision. We remain committed to advancing our IDO pathway inhibitor indoximod, which continues to generate exciting data in combination with anti-PD-1 agents, cancer vaccines, and chemotherapy in multiple cancer types including melanoma, prostate cancer, acute myeloid leukemia, and pancreatic cancer,” said Mr. Link.
Genentech returning rights of GDC-0919 caps another setback on NewLink Genetics Corp (NASDAQ:NLNK)’s push to build out its pipeline of oncology drugs. Early this month the biopharmaceutical company announced that one of its IDO-inhibitors had failed in a mid-stage breast cancer trial. The negative results prevents the company from expanding its usage beyond melanoma treatment.
NewLink Genetics Corp (NASDAQ:NLNK) stock remains under pressure as a wave of negative results on the clinical trial front continues to spook investors. NewLink Genetics Corp (NASDAQ:NLNK) stock was up by 1.30% in Wednesday’s trading session, to end the day at $6.22 a share.
I have no positions in any of the stocks mentioned, and have no plans to initiate any positions within the next 72 hours. All information, including any data, is provided without any guarantees of accuracy.
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About the author: Monica has an undergraduate degree in Accounting and an MBA she earned – with Honors. She has six years of experience in the financial markets and has been an analyst for the past two years.